Neco 2021 Economics Question 35

Practice objective / multiple choice question 35 from the 2021 Neco Economics examination.

Neco 2021 Economics Objective / Multiple Choice Medium Difficulty
Question 35 NECO • 2021 • ECONOMICS • objective

The government imposes a specific tax of \(\text{₦}2\) per unit on a good. The market demand is \(P = 30 - 3Q\) and the supply is \(P = 10 + Q\). Determine the equilibrium price paid by consumers, the price received by producers, the equilibrium quantity, the total tax revenue, and the dead‑weight loss caused by the tax.

Answer Options

A. Consumer price = \\(\\text{₦}17\\), Producer price = \\(\\text{₦}15\\), Quantity = 4 units, Tax revenue = \\(\\text{₦}8\\), Dead‑weight loss = \\(\\text{₦}0.8\\).
B. Consumer price = \\(\\text{₦}15\\), Producer price = \\(\\text{₦}13\\), Quantity = 5 units, Tax revenue = \\(\\text{₦}10\\), Dead‑weight loss = \\(\\text{₦}1\\).
C. Consumer price = \\(\\text{₦}18\\), Producer price = \\(\\text{₦}16\\), Quantity = 3.5 units, Tax revenue = \\(\\text{₦}7\\), Dead‑weight loss = \\(\\text{₦}1.5\\).
Correct Answer D. Consumer price = \(\text{₦}16.5\), Producer price = \(\text{₦}14.5\), Quantity = 4.5 units, Tax revenue = \(\text{₦}9\), Dead‑weight loss = \(\text{₦}0.5\).
Correct Answer
D
Correct Option:
Consumer price = \(\text{₦}16.5\), Producer price = \(\text{₦}14.5\), Quantity = 4.5 units, Tax revenue = \(\text{₦}9\), Dead‑weight loss = \(\text{₦}0.5\).

About This Question

This is Neco 2021 Economics Question 35. It is one of the objective questions from the 2021 Neco Economics examination.

Difficulty level: Medium .

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